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Annual Report 2021
Annual Report 2021
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Annual Report 2021
  • Annual Report 2024
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  • Annual Report 2021
  • Half-Year Report 2021
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Table of contents for the Annual Report 2021 report

Operational review
Key FiguresTo our shareholdersAbout Precious Woods / Sustainability
VisionProducts and marketsGoal of sustainable growthManagement organization with strong market orientationSustainable forestry in all dimensionsMarket opportunities thanks to sustainability certificatesContribution to the UN Sustainable Development GoalsPrecious Woods Amazon: Close ties with the local populationPrecious Woods in Gabon – Projects for the protection of flora, fauna, and biodiversitySounding BoardInstitutional framework as opportunity and challengeIllegal logging threatens certified timber trade and sustainable developmentCarbon FootprintThe role of forestry in the current climate change debateMilestones Precious Woods
Group results
Income statementBalance sheet
Brazil
Reduced harvest volume, increased production volumes, higher yieldNew concessions to secure our activitiesSummary of further activitiesSocial and environmental sustainability continues to be at high levelOutlook for 2022
Gabon
Operational successes despite difficultiesIncrease in working capital due to delivery delaysMany projects and activitiesOutlook for 2022
TradingCarbon & Energy
Emission certificates thanks to residual wood in BrazilianEmission trading together with myclimatePrecious Woods Carbon & Energy
Veneer
Veneer production
Corporate Governance
1. Group structure and shareholders2. Capital structure3. Board of Directors4. Group Management5. Compensation, shareholdings, loans6. Shareholders’ rights of participation7. Changes of control and defense measures8. Auditor9. Information policy
Shareholder information
Share capitalEquivalent to 100 sharesStock market listingShare register informationCompany headquartersStock price development
Financial Report
Precious Woods Group financial statements
Consolidated statement of profit or lossConsolidated statement of comprehensive incomeConsolidated statement of financial positionConsolidated statement of changes in equityConsolidated statement of cash flowsNotes to the consolidated financial statements
1. Basis of presentation, consolidation and general accounting policies2. Financial risk management3. Financial information by segment4. Revenue from contracts with customers5. Consumables used and other production costs6. Labour costs7. Other operating income and expenses8. Depreciation, amortization and impairment9. Financial income and expenses10. Property, plant and equipment11. Biological assets12. Intangible assets and goodwill13. Investment in associates14. Non current loans and investments15. Inventories16. Prepayments17. Trade and other receivables18. Trade and other payables19. Financial liabilities, other than trade and other payables20. Financial instruments by category and fair value hierarchy21. Leasing22. Share capital23. Major shareholders24. Earnings per share25. Related party balances and transactions26. Provisions27. Contingencies28. Income taxes29. Employee benefits30. Currency translation rates31. Basis of consolidation32. Increase of investment in MIL Energia Renovável Ltda.33. Subsequent events34. Approval of financial statements and dividends
Report of the statutory auditor on the consolidated financial statements
Precious Woods Holding Ltd financial statements
Balance sheets as of 31 December 2021 and 2020Statements of income 2021 and 2020Notes to the financial statements of Precious Woods Holding Ltd
Essential accounting and valuation principles1. General2. Authorized share capital3. Conditional share capital4. Investments in subsidiaries5. Financial assets to Group6. Other short term interest bearing liabilities7. Long term interest bearing liabilities8. Board and Executive compensation9. Depreciation, amortization and impairment10. Major shareholders11. Pledged assets / other securities12. Other note / Full time employment13. Other note / Lease liabilities14. Other note / Other short term liabilities15. Other note / Significant events after the reporting date
Report of the statutory auditor on the financial statements
Additional information
Contact addresses
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To our shareholders

Dear Shareholders

Precious Woods can look back on a successful and eventful year 2021. Increases in sales and revenue led to the financial successes we present in detail in the annual report. With an increase in sales of 17.6 % and an EBIT margin of 19.8 %, we have again made good progress. The high interest rates on borrowed capital and our excessively high working capital continue to have a negative impact. This excessive working capital is impairing our liquidity and, at the same time, we are unable to show the revenue hidden in our high inventories. These difficulties – which have arisen repeatedly due to logistics problems – hurt, and they overshadow the improvement of our operational activities. For this reason, and also because Covid-19 continued to complicate day-to-day operations and travel, 2021 was a major challenge.

Successful operational activity

In both Brazil and Gabon, sawmills achieved volume and yield increases in 2021. Combined with higher sales prices due to the good current market situation and reduced production costs, this resulted in an increase in profitability of which we can be proud. We see a lot of further potential: The new azobé hardwood sawmill in Bambidie is slowly entering normal operations after a difficult start. In Brazil, targeted, smaller investments are leading to increased cutting capacity, and we are confident that we will be able to maintain our results in 2022 despite currency fluctuations. In parallel to the technical and operational improvements, our management and specialized team in Switzerland, Gabon, Brazil, and the Netherlands knows how to ensure the stability and further development of our activities and processes with a great deal of commitment, motivation, and prudence. Last but not least, we can expect that our products made of tropical wood will continue to sell well in future, benefiting from the trend of increasing global demand for wood as a renewable raw and construction material.

Successful sustainable activity

The fact that Precious Woods passes its FSC and PEFC/PAFC certification audits with top marks almost goes without saying. This is because we, our management and our employees play a pioneering role in the sustainable management of tropical forest areas and will never compromise – this is the core of our vision and mission. With innovations such as the new FSC Ecosystem Services certifications for carbon storage and water conservation, we are also proving that sustainable forest management is one of the solutions to protect our world’s carbon sinks. As only the second company to be certified worldwide, we feel obliged to actively contribute our business model to the climate change debate. Because we are convinced that climate effective measures, are not exclusive to reforestation projects. And, of course, social sustainability completes our business model. Numerous projects presented in the following chapters – in cooperation with the local population but also with research institutions – are results or visible products of our effective activity.

Investments in renewal and growth

Over the past few years, we have laid the operational foundation for the further development of Precious Woods. We want to continue along this path and steadily improve our processes, products, and infrastructure. At the same time, we want to grow profitably – both qualitatively and quantitatively. Our defined strategic objectives include investments in the expansion of our managed forest areas in Brazil and Gabon, in the depth of our value chain, in our performance, and in our employees.

Unfortunately, our external debt in relation to EBITDA continues to be very high. The assets tied up in our forest areas in Brazil contribute to this. Given that growth financing via conventional financing institutions does not yet seem possible, we are actively seeking strategic partnerships and local financing options. Because interest on borrowing is too high, we have decided to issue a bond to counteract this situation.

Outlook and thanks

Infrastructural and institutional obstacles, along with the effects of the global pandemic, once again impacted the year. The operational progress and the financial result can be weighted and evaluated all the more in light of these circumstances. Our EBITDA of EUR 15.1 million, or 27.7 %, is a sustainable result that gives us an incentive, opens up opportunities, and at the same time represents an obligation.

On behalf of the entire Board of Directors, I would like to express my thanks for all the valuable contributions, the huge commitment, and the flexibility shown by the management of the Group, but also of the companies in Brazil, Gabon, and Switzerland. In particular, I would like to thank Markus Brütsch for his prudent leadership, but also for our good and constructive work together. And I would like to thank our approximately 1  500 employees of Precious Woods for their daily work not only for our company, but also for our mission.

I would also like to warmly thank my colleagues on the Board of Directors. I very much appreciate the open and reliable exchange of ideas. And finally, we would like to thank you, our valued shareholders – for your loyalty and for continuing to accompany, support, and promote the activities of Precious Woods through your commitment.

We look forward to welcoming you in person at this year’s General Meeting on 19 May 2022 at the Volkshaus in Zurich.

Yours faithfully

WSGE_DP_GR_Unterschrift_Chairman

Katharina Lehmann

Chairwoman of the Board of Directors